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Spotlight Stocks: Anheuser-Busch, Citigroup, KeyCorp, Thornburg


Thursday's top stories and stocks with potential to move.


Stocks to watch for Thursday, June 12, 2008:

  • Anheuser-Busch (BUD) received a $46.3 billion, or $65 a share bid from Belgian company InBev, the maker of Stella Artois and Beck's beers. InBev Chief Executive Carlos Brito said the merged company would keep on BUD top managers and board members, reported Reuters. Anheuser-Busch currently controls 48.5% of the US beer market.
  • Citigroup (C) will close its hedge fund Old Lane Partners, which was co-founded by CEO Vikram Pandit. The company will buy the remaining assets from the fund, which has seen so-so returns and has lost some of its top managers, reported The Wall Street Journal. Last month, it seemed Citigroup was going to give between $1-3 billion to the fund, but Citi's resources were too strained.
  • General Motors (GM) European President, Carl-Peter Forster, said slowing sales in North America is being echoed in certain European markets as well, hurt by rising fuel prices, commodity costs and the strength of the euro. Forster said that unlike other serious downturns in GM's history, the car maker is pumping investment into future product programs, reported Reuters.
  • KeyCorp (KEY) plans to raise approximately $1.5 billion of additional equity capital, consisting of newly-issued KeyCorp common shares and non-cumulative perpetual convertible preferred stock, in an effort to shore up its balance sheet. For the 2Q, the company will take an after-tax accounting charge to earnings and capital in the range of $1.1 billion to $1.2 billion for the leveraged lease tax litigation and all of KeyCorp's other contested leveraged lease transactions, according to a press release.
  • Starbucks (SBUX) plans to open 150 new locations in airports and railway stations in the UK, France and Germany in the next three years. As US sales have slowed, the company is looking to expand overseas, where it believes the grab-and-go coffee model will catch on, said the WSJ. Current studies show that of the locations already open outside the US, 80% of orders are consumed in the stores. The new locations will test the effectiveness of selling to customers on the move.
  • Thornburg Mortgage (TMA) reported a 1Q loss of $3.31 billion, or $20.64 per share, for the compared with profit of $75 million, or 62 cents per share, a year ago. The company has been hurt by loan delinquencies for larger "jumbo loans", worth over $417,000. Results included a $1.54 billion write-down for the value of mortgage-backed securities and securitized loans Thornburg owns.

Market Recap

  • Asian trading closed in the red with the Hang Seng -1.30%, Nikkei -2.08%, Sensex +0.43%, Taiwan -3.39% and Shanghai -2.21%.
  • Glancing towards Europe, we find fields of green with the CAC +0.47%, DAX +0.50%, FTSE +0.79%, ATX +1.02%, Swiss Mkt. +0.88% and Stockholm +0.60%.
  • In commodities, crude oil is lower -2.04 to 134.34 and gold is also down -9.0 to 870.7 this morning.
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No positions in stocks mentioned.

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